Andreessen's Opsware Stake: $138 Million

There’s lots of reactions around the blogosphere to today’s deal in which HP bought Opsware for $1.6 million. Erick Schonfeld from the.next.net unpacks the numbers on what the deal means for Opsware co-founder Marc Andreessen. The bottom line: the HP offer values Andreessen’s 9.7 million share stake at $138 million.

That’s a big number. But remember that it’s not a quick-hit YouTube-style payoff for Andreessen. The path from start-up to buyout was a winding seven-year journey that included a major retooling in 2002, when LoudCloud got out of the facilities business (selling its data centers to EDS) and focused on data center automation software. Andreessen enjoyed the boom at Netscape, but toughed out the dot-com nuclear winter at Opsware.

Marc also notes on his blog that Opsware has what may be a unique claim to fame among companies that went public prior to the dot-com crash:

One of my favorite facts about this deal is that at our acquisition price of $14.25 per share, everyone who bought and held stock in Loudcloud or Opsware in the public market at any time made money.

That’s the kind of exit most start-up founders would like. Andreessen has since co-founded Ning, which provides plug-and-play hosted social networking apps, and in recent months has been blogging up a storm at blog.pmarca.com, where he has shared his wealth of experience with start-ups, venture capitalists and bubbles.

Yes, $138 million is an eye-popping number. But Marc Andreessen has created a lot of value in the Internet economy and the data center industry. It’s a deserved happy ending for Marc and the Loudcloud/Opsware team, but for the company’s investors and shareholders as well.

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About the Author

Rich Miller is the founder and editor at large of Data Center Knowledge, and has been reporting on the data center sector since 2000. He has tracked the growing impact of high-density computing on the power and cooling of data centers, and the resulting push for improved energy efficiency in these facilities.